A recent study has brought to light the financial advantages of working with Independent Mortgage Brokers, underscoring the significant savings and inclusive support they offer to a diverse range of homebuyers. The study, conducted by Polygon Research and backed by Willow Canyon Advisors and United Wholesale Mortgage (UWM), analyzed 2023 data, and found that consumers who choose Mortgage Brokers over nonbank retail lenders can save an average of $10,662 over the life of their loan.
“For over a decade, we’ve seen the wholesale channel consistently deliver better value for consumers,” said Mat Ishbia, President and CEO of UWM. “This data reinforces what we’ve known—Independent Mortgage Brokers provide a more cost-effective, seamless, and personalized borrowing experience. It’s no surprise that the broker channel continues to grow, and we believe it could capture 50% of the market.”
The study also highlighted that borrowers in the wholesale channel paid less upfront in 2023, a year marked by notably high interest rates. Specifically, those in the wholesale channel paid an average of 115 basis points to secure a 6.58% interest rate, compared to 148 basis points for a 6.60% rate through nonbank retail lenders.
Beyond the general consumer benefits, the research revealed even greater savings for specific groups, including veterans and minority borrowers. For example, veterans using VA loans through Independent Mortgage Brokers saved an average of $13,432 per loan, obtaining a more favorable 6.26% interest rate compared to 6.40% with retail lenders. Additionally, they paid significantly less upfront—87 basis points versus 106 in the retail channel.
The study also pointed to the vital role that Mortgage Brokers play in promoting homeownership among minority communities. In 2023, the wholesale channel not only approved a higher percentage of loans for Minority Majority Census Tracts (MMCT) but also demonstrated a stronger overall approval rate compared to retail channels—70% versus 58% in MMCTs, and 75% versus 64% in non-MMCTs.
“These findings are not just about the numbers; they highlight how Mortgage Brokers are better equipped to serve minority borrowers,” said Jonathon Haddad, CEO of the Association of Independent Mortgage Experts (AIME). “Brokers’ local expertise and access to a wide array of loan products enable them to address the specific needs of these communities, especially in challenging economic times.”
As the study underscores, mortgage brokers are not only saving consumers money but also playing a critical role in expanding homeownership opportunities to underserved groups. Their ability to offer personalized service and competitive rates makes them a crucial player in today’s housing market.
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